The jump reflected tariff hikes imposed by the Trump administration, a Treasury official told reporters. Trump on April 2 unveiled “reciprocal” tariffs on dozens of countries, before putting all of them except China’s on pause a week later. “Liberation Day” also featured a new universal 10% baseline levy.
Monday’s data came out hours after the US reached a tentative deal with China to remove a swath of escalatory tariffs. Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer announced that American levies on Chinese goods would come down to 30% for now, from 145%. Last week, the US reached a trade agreement with the UK.
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or the first seven months of the fiscal year, the federal government logged a $1.05 trillion deficit, a 13% increase on the same period a year earlier after accounting for calendar-year differences. Taking out some deferred taxes that had inflated 2024 revenue, the 2025 deficit is 4% wider, a Treasury official said.
Rising interest costs on the public debt, along with steeper outlays on categories including Medicare and Social Security, continue to account for a large share of the added borrowing needs.
Besides customs, another revenue category seeing an increase this fiscal year is excise taxes, which have climbed by $10 billion over the past seven months. That’s largely thanks to a new levy on stock buybacks, a Treasury official said. That tax was enacted as part of the Biden administration’s 2022 renewable energy package, known as the Inflation Reduction Act.
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